Firstrand Bank Limited T/A Wesbank v Shosholoza Steel Suppliers (Pty) Ltd and Others (21582/2010) [2014] ZAGPJHC 55 (19 February 2014)

REPUBLIC OF SOUTH AFRICA

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG LOCAL DIVISION, JOHANNESBURG)

CASE NO: 21582/2010

DATE: 19 FEBRUARY 2014

In the matter between:

FIRSTRAND BANK LIMITED t/a WESBANK.................................................Applicant

And

SHOSHOLOZA STEEL SUPPLIERS (PTY) LTD......................................1st Respondent

JIYANE MADODA JOHN.........................................................................2nd Respondent

SIGAUKE OWEN.......................................................................................3rd Respondent

KODISANG SHIMANE CORNELIUS.....................................................4th Respondent

LEKAU MOETI DAVIT..............................................................................5th Respondent

J U D G M E N T

MASHILE, J:

[1] This is an application by which the Applicant seeks to amend its particulars of claim in terms of Uniform Rule 28.

[2] The background facts are that the Applicant and the First Respondent concluded four written instalment sale agreements on 30 September 2008 and 15 October 2008. These agreements were concluded at Boksburg and Bedfordview respectively.

[3] The objective of all the instalment sale agreements was to enable the First Respondent to finance two vehicles and two trailers.

[4] Subsequently, on 30 September 2008 and at Boksburg the Second to Fifth Respondents stood surety and bound themselves as co-principal debtors with the First Respondent in favour of the Applicant.

[5] In so doing, the Second to Fifth Respondents became jointly and severally liable for the due payment of all amounts which the First Respondent may from time to time thereafter owe to the Applicant from whatsoever cause and howsoever arising.

[6] During the ensuing months the First Respondent failed to live up to its obligations arising from all the four agreements by failing to make prompt monthly payments.

[7] Upon this violation of the agreements, the Applicant, as it was entitled to do, cancelled the instalment sale agreements and thereafter instituted action for the return of the two trucks and two trailers.

[8] The Respondents served and filed their Notice of Intention to Defend the action against the First Respondent but failed to resist a summary judgment application that the Applicant launched following their Notice as aforesaid.

[9] On 14 October 2010 The court granted judgment against the First Respondent ordering it to return the trucks and trailers and to pay costs as on the scale between attorney and client.

[10] The court also granted an order postponing the question pertaining to damages against the Second to Fifth Respondents that the Applicant may have suffered together with interest thereon sine dies.

[11] The postponement was pending the return of the vehicle to the Plaintiff, the subsequent valuation and sale thereof and the calculation of the amount to which the Applicant would be entitled.

[12] Following this order of the court, the trucks and trailers were returned to the Applicant and accordingly valuated, sold and calculation of the shortfalls on each determined.

[13] On 12 and 13 December 2013 the Applicant respectively served and filed a Notice in terms of Rule 28. The actual extract from the unamended particulars of claim of the Applicant read:

“1A. An order directing the First Defendant to forthwith return to the Plaintiff a Freightliner/Argosy 90 CAT 440 truck with chassis number 1FUJAWAS49LAE0525 and engine number 8YF02537, failing which the Sheriff is authorised to attach the first truck wherever he may find same and to hand the first truck to the Plaintiff;

1B. That judgment for the amount of damages that the Plaintiff may have suffered, together with interest thereon, be postponed sine die, pending the return of the vehicle to the Plaintiff, the subsequent valuation and sale thereof and the calculation of the amount to which the Plaintiff is entitled.”

[14] With the exception of the description of the truck, the relief claimed by the Applicant in the other four claims is the same such that 2A and B, 3A and B and 4A and B all mirror 1A and B in Claim 1 quoted above.

[15] The Applicant now proposes to amend its particulars of claim by deleting Prayers 1A and 1B extracts of which are cited above and substituting therefore with a claim for:

“1 A. Payment of the sum of R863 046.06;”

[16] The Applicant intends making similar amendments to the corresponding prayers in respect of claims 2 to 4 except of course that the amount claimed differs from claim to claim depending on the amount for which each item was sold.

[17] There are other amendments in all the claims such as those dealing with the rate of interest but the above represents the core. According to the Applicant The essence of the amendment is to claim damages which it could not have claimed at the time when judgment for the return of the vehicle was granted because the trucks and trailers were still outstanding, not valued, not sold and no calculations made.

[18] The Respondents are opposing the amendment on the basis that:

18.1 The relief sought in Prayers 1B, 2B, 3B, and 4B of the unamended particulars of claim does not constitute a claim for payment of damages as a result of a breach of contract;

18.2 The Applicant having not claimed payment of any amount from the Respondents previously in its particulars of claim, it is now introducing a claim for payment of damages for breach of contract by this amendment;

18.3 Accordingly, contend the Respondents, the Applicant seeks to introduce a new cause of action by way of this amendment.

18.4 The respondents assert further that Prayers 1B, 2B, 3B, and 4B do not constitute a claim for payment of these damages as contemplated in Section 15(1) of the Prescription Act No. 68 of 1969;

18.5 The Applicant’s claim has prescribed as a period of three years has elapsed since 14 September 2010, the date on which the court granted summary judgment for the return of the trucks and trailers together with costs.

[19] The Respondents have appositely captured the issues to be determined by this court as follows:

19.1 Whether or not the proposed amendment establishes a new cause of action to this matter;

19.2 If the amendment does not constitute the introduction of a new cause of action, whether or not the summons in this matter makes up a claim by the Applicant for payment of contractual damages for the purposes of s 15(1) of the Prescription Act of 1969.

THE RELIEF CLAIMED IN CLAIMS 1B, 2B, 3B AND 4B IS NOT A CLAIM FOR DAMAGES ARISING FROM A BREACH OF CONTRACT

[20] The cause of action for the return of the trucks and trailers emanates from the violation of the four instalment sale agreements by the First Respondent. Inextricably linked to the claim for the return of the items, is a claim for damages against the Second to Fifth Respondents which arises in consequence of the Second to Fifth Respondents having bound themselves as sureties and co-principal debtors with the First Respondent.

[21] The claim for damages against the Second to Fifth Respondents while based on the suretyship agreement would not have arisen had there been no breach of the instalment sale agreements by the First Respondent.

[22] The postponement of the claim for damages against the Second to Fifth Respondents pending the return of the two trucks and two trailers for subsequent valuation and sale had to occur first. It was only After the return, valuation and sale of the items that the Applicant could again approach this court for relief with precise calculated amounts of damages.

[23] It follows therefore that while the claim for the return of the items against the First Respondent is based only on breach, the claim for damages against the rest of the Respondents is premised on both breach and suretyship agreement. Both these allegations were made in the unamended particulars of claim.

[24] This situation is different from the scenario painted in Evins V Shield Insurance 1980 (2) SA 814 (A) to which Counsel for the Respondents has referred me. The Evins case dealt with circumstances where the plaintiff had instituted a claim based on a particular cause of action for which he was successful.

[25] However, three years thereafter the Plaintiff then purported to bring another claim based on another cause of action albeit that it arose from the same incident. The court dismissed the second claim on the basis that it had prescribed.

[26] The claim against the Second to Fifth Respondents in the present case is lucidly delineated. This is evident when one reads the prayers of the unamended particulars of claim:

“WHEREFORE the Plaintiff prays for judgment against the First Defendant for:-

IA. an order directing the First Defendant to forthwith return to the Plaintiff a Freightliner/Argosy 90 CAT 440 truck with chassis number 1FUJAWAS49LAE0525 and engine number 8YF02537, failing which the Sheriff is authorised to attach the first truck wherever he may find same and to hand the first truck to the Plaintiff;

AND AGAINST THE FIRST, SECOND, THIRD, FOURTH AND FIFTH DEFENDANTS, JOINTLY AND SEVERALLY, THE ONE PAYING THE OTHER TO BE ABSOLVED, FOR:-

IB. that judgment for the amount of damages that the Plaintiff may have suffered, together with interest thereon, be postponed sine die, pending the return of the vehicle to the Plaintiff, the subsequent valuation and sale thereof and the calculation of the amount to which the Plaintiff is entitled;”

[27] To remove any doubts that the Plaintiff has indeed claimed damages against the Second to Fifth respondents the above should be read and understood as follows:

“WHEREFORE the Plaintiff prays for judgment against the Second to Fifth Respondents, jointly and severally, the one paying the other to be absolved, for:-

[28] This should remove any uncertainties that the Applicant has claimed damages against the Second to Fifth Respondents. The claim was however postponed sine dies as the Applicant did not at the time have the exact amount for which the Second to Fifth Respondents were to be sued.

DOES THE AMENDMENT INTRODUCE A NEW CAUSE OF ACTION

[29] I have to an extent dealt with this question above. For what it is worth, perhaps it is wise to repeat it here again. The amendment does not introduce a new cause of action. This is for two simple reasons and these are that:

29.1 At the time when the Applicant instituted the claim, it could not define the damages without first repossessing the items for valuation, sale of the items and the ultimate calculation of the shortfall for each item.

29.2 The suretyship agreements have already been alleged and proved in the unamended particulars of claim. While it is a claim based on the suretyship agreement, it does not have independent existence in that it is reliant on the breach of the instalment sale agreements by the Second to Fifth Respondents.

PRAYERS 1B, 2B, 3B, AND 4B DO NOT CONSTITUTE A CLAIM FOR PAYMENT OF DAMAGES AS CONTEMPLATED IN SECTION 15(1) OF THE PRESCRIPTION ACT NO. 68 OF 1969

[30] Section 15(1) of the Prescription Act No. 68 of 1969 is headed: “JUDICIAL INTERRUPTION OF PRESCRIPTION” and it provides:

“The running of prescription shall, subject to the provisions of Subsection (2), be interrupted by the service on the debtor of any process whereby the creditor claims payment of the debt.”

[31] I have already concluded that the unamended particulars of claim of the Applicant contain sufficient averments capable of sustaining a claim of damages against the Second to Fifth Respondents. The claim of those damages however had to be postponed sine dies as they still had to be determined after the repossession of the items. Once I have so concluded, it should of necessity follow that Prayers 1B, 2B, 3B, and 4B constitute a claim for payment of these damages as contemplated in Section 15(1) of the Prescription Act No. 68 of 1969.

[32] In this regard I have quoted the relevant prayer above which makes it inescapable that the claim for damages was instituted against the Second to Fifth Respondents but was postponed as the amount could not be ascertained at the time. Accordingly, prescription was interrupted as contemplated in Section 1 of the Prescription Act NO.68 of 1969.

[33] I do not find the case of (Blaauwberg Meat Wholesalers CC v Anglo Dutch Meats (Exports) Ltd 2004 (3) SA 160 (SCA)) particularly helpful as it dealt with a different set of circumstances. Since this court has reached the conclusion that damages were claimed in the unamended particulars of claim, prescription was interrupted as per Section 15(1) of the Prescription Act No.68 of 1969. Obviously this case is not one of misnomer or incorrect description of parties.

[34] It is trite that the power of the court to allow amendment is limited only by consideration of prejudice or injustice to the opponent. See Page B1-179 of Superior Court Practice by Erasmus, Farlam, Fichardt & Van Loggerenberg. The fact that the outcome of the amendment may result in the one party losing the case is no reason not to allow an amendment.

[35] Perhaps it is pertinent to refer to the Evins case that I have referred to above where the court stated:

“Where a plaintiff seeks by way of amendment to augment his claim for damages, he will be precluded from doing so by prescription if the new claim is based on a new right of action and the relevant prescriptive period has run, but if it was part and parcel of the original right of action and merely represents a fresh quantification of the original claim or the addition of a further item of damages.”

[36] There is very little doubt that the current amendment sought by the Applicant was part and parcel of the original right of action and that it merely represents a fresh quantification of the original claim of damages that were postponed sine dies pending the repossession of the trucks and trailers for valuation, sale and determination of the shortfall.

[37] In the premises the application succeeds and the following order is made:

1. The application in terms of Rule 28 is granted;

2. The Respondents are given an opportunity to file their plea or adjusted plea, as the case may be, within 20 days from date of this order;

3. No order as to costs.

B MASHILE

JUDGE OF THE SOUTH GAUTENG

HIGH COURT, JOHANNESBURG

Date of hearing: 30 January 2014

Date of judgment: 19 February 2014

Counsel for the Applicant: K Meyr

Instructed by Smit Jones & Pratt Attorneys

Counsel for the Respondent: A McKenzie

Instructed by DMO Attorneys